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ScS pulls out of House of Fraser after concession sales halve

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ScS is seeing its online sales grow fast, contrasting with those via House of Fraser concessions
ScS is seeing its online sales grow fast, contrasting with those via House of Fraser concessions
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ScS pulls out of House of Fraser after sales via its concessions halve

ScS this week said it would close its 27 House of Fraser concessions by the end of January after the sales made through its presence in the department store halved in the first quarter of its financial year.

 

The sofa and carpet specialist, which is a Top500 retailer in IRUK Top500 research, is now looking to redeploy the more than 120 staff who work at those concessions elsewhere in its business.

 

Like-for-like orders at its concessions within House of Fraser branches fell by 52.5% in the first 12 weeks of its financial year, to October 20. That contrasts with overall growth in like-for-like orders across the business of 1.2%. At the same time, the core ScS business saw like-for-like orders grow by 4.5%, meeting expectations. House of Fraser concessions accounted for 2.7% of ScS orders over the 12 week period.

 

In its latest full-year, which finished on July 28, just over two weeks before House of Fraser went into administration, ScS sold sofas and carpets through its 27 House of Fraser concessions to the tune of £24.8m - down by 9.4% on the previous year, and representing 7.1% of ScS total sales. Trading within House of Fraser, ScS said, had been challenging amidst uncertainty over the department store’s viability.

 

Since then House of Fraser’s acquisition out of administration by Sports Direct, however, sales have collapsed more sharply, halving in the first 12 weeks of the year, and representing a fraction of its total sales.

 

This week David Knight, chief executive of ScS, said: "I would like to take this opportunity to thank all of our colleagues who have worked in our House of Fraser concessions over the past few years for their dedication and hard work. However, given developments in House of Fraser over the last few months, it has become clear that the partnership was no longer beneficial to ScS.

 

"We are pleased to announce that we have continued to trade well in the core ScS business in the first 12 weeks of our financial year. We will continue to focus on our successful value offering proposition, coupling this with the excellent service that ScS provides and that our customers know and love."

 

ScS started to operate concessions within House of Fraser stores in 2014. ScS said, in its full-year statement, that the presence enabled it to put its goods in front of those shoppers who preferred to shop on the high street or in department stores.

 

Some of those shoppers may be choosing to buy its wares on the internet instead: in its full-year figures, ScS reported record online sales at £13.8m, up by 22.6% on the previous year. Thus, 3.9% of its total full-year sales of £352.3m took place online – a small but growing percentage. In the previous year, to July 2017, ScS online sales grew by 12.3% to £11.3m.

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